Losses widen for software firm as it sets itself ambitious growth target
BACK office software specialist eg solutions has set itself the ambitious target of growing revenues to £12m over the next two financial years.
The Staffordshire firm, which has undergone a turbulent time this year, said it was now focused on ensuring its infrastructure was in the best shape possible to meet the challenge.
The company’s latest set of interims underline how ambitious the target is.
In the half-year to July 31, 2016 revenue dropped to £2.5m (H1 2015: £3.6m), with losses widening to £1.5m (H1 2015: -£0.33m).
Elizabeth Gooch, chief executive, said: “Whilst the early part of the year has yielded revenue and EBITDA below our expectations, the board is encouraged by the increase in contract wins towards the end of the first half together with a strong pipeline of new business.
“During the latter part of the period, the board conducted a review of its business involving a critical assessment of its product, the market the business operates in and the quality, depth and scale of its internal resources.
“In terms of product, the review concluded that the company has an industry-leading product suitable for UK and international markets which is fit for purpose and can comfortably accommodate the board’s significant growth aspirations over the next few years.”
She said the firm was confident that the marketplace for its products existed – both in the UK and overseas.
“More than ever businesses are seeking to continuously improve their end-customer experience and better utilise their resources to drive efficiencies. The board concluded that the company has clear visibility of the market and is ideally placed to satisfy customer needs with its market-leading product,” she added.
The findings of the review have been supported by the significant increase in new contracts secured in recent weeks and the strong current order book. New contracts secured in the Asia-Pacific region are particularly encouraging given our short time operating in this market.
However, the board’s review also concluded that the breadth and depth of the company’s sales resources and channels are insufficient to fulfil the board’s growth objectives for the forthcoming years.
“Accordingly a restructure has been implemented within the management team to increase focus on revenue generation and recruit the required management skills to support growth. These structural changes are almost complete and set the company in a strong position going into the second half of the financial year and beyond,” said Mrs Gooch.
